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Slush Corporation has two bonds outstanding. each with a face value of $21 million. Bond A is
secured on the company's head office bullding; bond B is unsecured. Slush has suffered a severe
downturn in demand. its head office building is worth $101 million, but its remaining assets are
now worth only $2 million. If the company defaults, what payoff can the holders of bond B
expect? Note: Enter your answer in dollars, not in millions. Round your answer to the nearest
whole dollor amount.

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Slush Corporation has two bonds outstanding- each with a face value of (1).pdf

  • 1. Slush Corporation has two bonds outstanding. each with a face value of $21 million. Bond A is secured on the company's head office bullding; bond B is unsecured. Slush has suffered a severe downturn in demand. its head office building is worth $101 million, but its remaining assets are now worth only $2 million. If the company defaults, what payoff can the holders of bond B expect? Note: Enter your answer in dollars, not in millions. Round your answer to the nearest whole dollor amount.